With the launch of a new video-on-demand service dubbed Cravetv, Bell Media hopes to take on Internet streaming giants while still keeping one foot firmly planted on the side of its traditional television business.
The media division of BCE Inc. will host an event in Toronto on Wednesday to unveil the features of the new service that will launch by the end of the year and compete with subscription-based offerings from U.S.-based Netflix Inc. and homegrown rival Shomi, a joint venture between Rogers Communications Inc. and Shaw Communications Inc.
But in an interview with The Globe and Mail Monday, Bell Media president Kevin Crull said that unlike Shomi, the library of more than 10,000 hours of television programming on Cravetv will only be available for purchase to customers with a traditional TV subscription.
"We want the consumer to have a TV subscription," he said of the service, which has previously been referred to by its code name Project Latte.
"So you can subscribe to any level of television, you can subscribe to basic TV, or even what has become known as 'skinny basic,' or you can subscribe to a really high-end package," Mr. Crull added.
Shomi, which Rogers and Shaw announced in August and launched last month, is available to any of the two companies' television or Internet subscribers for a fee of $8.99 a month and can be accessed online, through tablets or mobile devices or set-top boxes for TV customers.
Mr. Crull said Bell Media wanted to address a "white space" in the television world, which already offers video-on-demand options for movies as well as children's programming but not a wealth of past seasons of television shows.
"We're focusing on TV, which is a unique part of our approach to the business model. We're distributing this through Canada's [television] distributors – not bypassing the current ecosystem," he said, noting that the company has been in talks with all of Canada's major cable, satellite and IPTV providers to strike distribution agreements for Cravetv to their television customers.
The traditional television industry has come under intense pressure in recent years from so-called over-the-top competitors like Netflix, and Canadian media companies have been working to come up with their own video-streaming products that they hope will address a consumer desire for binge-watching without kneecapping their own television distribution businesses.
Total television subscribers in Canada fell slightly last year, dropping by 0.1 per cent to 11.9 million households in 2013, according to the most recent report from the Canadian Radio-television and Telecommunications Commission. Among the five largest television distributors, the cable providers Rogers, Shaw, Cogeco Cable Inc. and Quebecor Inc.'s Videotron Ltd. all suffered subscriber losses from 2013 to 2014, the CRTC said. Bell – which has benefitted from subscriber growth due to its four-year-old Fibe TV Internet protocol television product even as its satellite division has posted losses – actually added customers to its television subscriber base in that time period.
Bell Media participated in initial discussions about joining the Shomi project but ultimately decided to go in its own direction.
"We respect what [Shomi is] doing and we think Canadian services should fight to protect the Canadian market – we don't believe it's right what Netflix has been able to do," Mr. Crull said. At a regulatory hearing in September, Bell executives complained that unregulated online competitors don't have to contribute to the Canadian broadcast system. "So we're pleased to see everybody working in this space, but we felt we could do something different and more meaningful, and that's been what our strategy is to pursue."
Customers will be able to access the service through their set-top boxes, or through smart-TV applications, which rely on an Internet connection, as well as certain gaming consoles, Mr. Crull said, noting that authenticated users will also be able to watch through a Cravetv website.
Bell Media has already announced much of the content it has secured Canadian streaming rights for – including the HBO back catalogue of scripted shows, Monty Python's Flying Circus and a comedy library led by Seinfeld – as well as distribution agreements with its own Bell and Bell Aliant divisions and Telus Corp. through its OptikTV service.
Mr. Crull said the company has been in talks with other television providers for the past three months. "We've had extensive conversations with every major distributor and Wednesday we will have announcements of more distributors picking [Cravetv] up. I'm hopeful that within maybe three months that this will be available to every Canadian who has a TV service, that every distributor picks it up."
"I would point out that's very different from the other service in the market, which did this cute little beta trial where they decided to just keep it to themselves," Mr. Crull said, in a jab against Shomi, which launched in a test phase for the first six to 12 months and so far is only available to Rogers and Shaw customers. "Our product isn't launching in beta, it's launching ready for market, ready for prime time and that will be within a few weeks."
He said the service will launch no later than the end of this year at a price to be revealed Wednesday and will contain television programming, apart from a handful of HBO-produced made-for-TV movies. Shomi, which has 12,000 hours of content, has primarily television content but also includes a movie library. (BCE owns 15 per cent of The Globe and Mail.)
Cravetv will have 12 per cent Canadian content at launch, in contrast to Shomi's 30 per cent, but Mr. Crull said it will be the "most-watched and acclaimed prime-time Canadian programming."
A company associated with BCE formalized a number of trademarks associated with "Crave" in October and Mr. Crull said the name Cravetv, which he confirmed Monday, "perfectly embodies passion and desire and our product is all about satisfying that passion and desire of TV lovers."